Pentegra Services Inc. has agreed to a $48.5 million settlement to resolve a class action lawsuit alleging violations of the Employee Retirement Income Security Act (ERISA). The lawsuit claims the company caused the Pentegra Defined Contribution Plan for Financial Institutions to pay excessive recordkeeping and administrative fees.
Who Is Eligible?
You may be eligible if you were a participant or beneficiary in the Pentegra Defined Contribution Plan for Financial Institutions at any time between September 15, 2014, and April 30, 2025.
The settlement class includes:
- Current participants: Those who had an active plan account with a balance as of April 30, 2025.
- Former participants: Those who no longer had a plan account with a balance above $0 as of that date.
Beneficiaries, alternate payees, or attorneys-in-fact of a participant can file a claim if they provide proof of authority to act on the participant’s behalf.
Settlement Amount and Payments
The $48.5 million settlement will be divided after deducting:
- Administrative costs
- Attorneys’ fees and expenses
- Service awards to class representatives
The remainder will be distributed pro rata to eligible class members based on their account balances or participation period. Those with higher balances or longer plan participation will receive larger payments.
If a class member’s calculated share is less than $10, they will receive a minimum payment of $10.
How to Receive a Payment
Current participants
- Do not need to file a claim.
- If the settlement is approved, your payment will be automatically deposited into your plan account.
Former participants
- Must submit a claim to receive payment.
- You can file online using your claim number and PIN, or you can download, print, and mail the claim form to:
Pentegra 401(k) Settlement
P.O. Box 2009
Chanhassen, MN 55317-2009
Deadline to file a claim: November 16, 2025
Required Information
All claimants must provide:
- Social Security number or taxpayer identification number
- Claim number and PIN (from your notice, if filing online)
- Documentation of authority if filing on behalf of a class member
Payment Options
Former participants may choose:
- A paper check mailed to their address
- A rollover into a qualified retirement account (401(k), 403(b), 457(b), Traditional IRA, or Roth IRA)
If no option is selected, a paper check will be mailed by default.
Current participants will automatically receive their payment into their plan account.
Breakdown of the $48.5 Million Settlement Fund
- Attorneys’ fees: Up to $16,165,050
- Attorneys’ expenses: Up to $1,185,000
- Service awards: Up to $25,000 each for three representatives
- Administration costs: To be determined
- Payments to class members: Remaining balance
Important Dates
- Claim deadline: November 16, 2025
- Final approval hearing: November 26, 2025
When Will Payments Be Made?
Payments will be issued approximately 150 days after final court approval and after any appeals are resolved.
Why Was There a Settlement?
The lawsuit claimed that Pentegra caused the retirement plan to overpay for administrative services, violating ERISA’s requirements to act in the best interest of participants. Pentegra denies any wrongdoing, but chose to settle to avoid further litigation.
Award: Varies based on account balance and participation
Claim Deadline: November 16, 2025
